Business

New Naira Notes: Panic, Confusion As Nigerians Count Down To Deadline

Published

1 year ago

January 28, 2023

Editor

Across the country, Nigerians are living in uncertain times regarding their money, both the cash at hand and the one they have saved in the banks as the Central Bank Governor, Godwin Emefiele insists that the January 31st deadline for the usage of old currency notes remains sacrosanct.

“As things stand, the N200 denomination is scarce. We rely a lot on N200 notes, but we don’t have it. I still have lots of N200 in my box,” Dolapo Michael, a trader in Yaba area in Lagos State, told DAILY POST.

Mrs Michael’s predicament is not in isolation as many Nigerians are faced with uncertainty over the latest policy by the CBN. While the apex bank insisted that the policy is targeted at mopping up cash into the banking sector, however, it has become a political issue.

Bola Tinubu, the presidential candidate of the All Progressives Congress (APC) at the party’s campaign rally in Abeokuta, the Ogun State capital, alleged that the policy was targeted at him.

The two chambers of the National Assembly also asked the CBN to as a matter of urgency extend the period by 6 months; however, the CBN boss insisted that there shall be no extension.

Even the threat of a warrant of arrest has not swayed the CBN boss as he shunned the invitation of the House on two occasions.

The lawmakers are insisting that section 20 of the CBN Act mandates commercial banks to continue to accept the old notes even after the expiration of the deadline.

“The House is also aware that Section 20 (3) Central Bank of Nigeria (CBN) Act mandates the CBN to redeem the face value of the recalled currency upon demand, even after the expiration of the notice of recall. Notwithstanding the deadline imposed by the Central Bank of Nigeria(CBN), this House will see to it that this provision of the law is honoured in full,” Femi Gbajabiamila, the Speaker of the House said on Thursday.

However, banks have insisted that they will comply with the directive of the CBN on the subject matter.

On Friday, First Bank announced that it will no longer accept the old notes by 1st of February, therefore, urging its customers to take advantage of the weekend to deposit their old currency.

“This is to notify the general public that all our branches will be open on Saturday and Sunday just to receive cash.

“All old Naira notes of series 200, 500, and 1000 will cease to be in use from the 31st of January,” he said.

On Thursday, during a meeting between the banks and the committee of the House, bankers acknowledged that the new notes are not sufficient to meet the demand of Nigerians.

The representative of Sterling Bank, Orlando Umoren informed the lawmakers that the CBN rationed the money to different banks, but it was not sufficient to meet their needs.

He stated that Sterling Bank gets N150 million weekly for its branches in Kaduna, while N100m is shared among all its branches in Kano metropolis.

Also, the representative of Access Bank, Hadiza Ambuza said the bank is only able to disburse 10% of the total money it collects from customers.

“We are paying as much as we get. We are collecting the money and loading it at the ATM as quickly as we get it. Unfortunately, we are not getting them quickly. We have gotten about 10 percent of the total money. That is a challenge that we have. We are doing the best we can up until the deadline,” she said.

Despite the low circulation, the banks are following the directive of the CBN on the deadline.

The House of Representatives has insisted it will suspend its planned recess to address the issue and is willing to issue a warrant of arrest on Emefiele and speak with President Muhammadu Buhari.

Hakeem Liadi, a resident of Isanlu, in Kogi State, told DAILY POST that due to activities of armed robbers along the Kabba-Ilorin road, most banks have shut down and they rely on POS.

“In some instances, POS operators now charge as much as N100 on every N1,000 for Nigerians to get new notes,” Leadi said, adding that “We use POS for our transactions, it is like our own bank. With the rush, POS are also struggling to get the new notes. So, when they charge extra, we cannot complain.”

Lekan Olaleye, an economist, who spoke to DAILY POST, said the policy may be conceived with good intentions, however, the implementation may cause a significant impact on the economy.

“The CBN must understand that Nigeria is far from a cashless economy. Perhaps, they are overestimating data from POS terminals. As it stands, POS in Nigeria are for withdrawal of money not payment for goods. This economy still relies heavily on cash.

“By Monday, most commercial drivers may not want to accept the old note in fear of the deadline, but from findings, the new money is not circulating well enough. The CBN should have used the POS agents to speed up the circulation,” he noted.

When Mr Olaleye was asked about the intent of the CBN to curb kidnapping and vote buying by politicians, he said the mischief the bank seeks to curb may create a bigger problem.

“Poison is not the cure for cancer. Can the banks cope with the demand for money on February 1st? Apart from that, a large percentage of daily transactions still involves cash,” he said.
DAILY POST

Business

Stock Market Review: FBN Holdings Leads 41 Others As Investors Gain N811bn

Published

23 hours ago

May 4, 2024

Editor

FBN Holdings Plc has topped 41 other advanced equities to pull the Nigerian Exchange Ltd.(NGX) market indices up by 1.46 per cent, week-on-week, making investors gain N811 billion.

The market, having opened for four days in the week, following the May Day holiday, had FBN Holdings leading the gainers’ table by 32.68 per cent to close at N27 per share.

Sterling Financial Holdings followed by 27.75 per cent to close at N4.88, while UACN gained 24.60 per cent to close at N15.45 per share.

Julius Berger added 23.76 to close at N72.40, while Flour Mills rose by 20.66 per cent to close at N36.80 per share.

Conversely, Nascon Allied Industries Plc led the losers’ table by 17.03 per cent to close at N43.60, University Press trailed by 16.67 per cent to close N2.05 per share.

Neimeth International Pharmaceuticals shed 14.14 per cent to close at N1.70, Berger Paints Plc declined by 9.87 per cent to close at N13.70 and Vitafoam Nigeria lost 9.81 per cent to close at N17 per share.

Meanwhile, 42 equities appreciated in price during the week, higher than 27 equities in the previous week.

Thirty-six equities depreciated in price, lower than 43 in the previous week, while 76 equities remained unchanged, lower than 84 recorded in the previous week.

Consequently, the All-Share Index and Market Capitalisation appreciated by 1.46 per cent to close the week at 99,587.25 and N56.323 trillion, respectively, in contrast to 98,152.91 and N55.512 trillion posted last week.

Similarly, all other indices finished higher with the exception of NGX Consumer Goods, NGX Oil and Gas and NGX Industrial Goods which depreciated by 0.26, 0.68 and 0.36 per cent, respectively, while NGX ASeM and NGX Sovereign Bond indices closed flat.

Meanwhile, a total turnover of 1.941 billion shares worth N32.644 billion in 35,807 deals was traded this week by investors on the floor of the Exchange, in contrast to a total of 1.839 billion shares, valued at N34.258 billion, that exchanged hands last week in 37,528 deals.

The financial services industry measured by volume led the activity chart with 1.496 billion shares valued at N22.453 billion traded in 19,225 deals, thus contributing 77.08 and 68.78 per cent to the total equity turnover volume and value, respectively.

The consumer goods industry followed with 144.722 million shares worth N5.063 billion in 4,966 deals.

In the third place was the conglomerates industry, with a turnover of 109.978 million shares worth N1.539 billion in 2,064 deals.

Trading in the top three equities, namely Abbey Mortgage Bank Plc, Guaranty Trust Holdings Company Plc and Access Holdings Plc, measured by volume, accounted for 898.940 million shares worth N14.314 billion in 5,518 deals.

These contributed 46.31 and 43.85 per cent to the total equity turnover volume and value, respectively.

(NAN)

Business

BREAKIN: NDIC Increases Maximum Deposit Insurance Coverage

Published

3 days ago

May 2, 2024

Editor

The Nigeria Deposit Insurance Corporation (NDIC) on Thursday increased the maximum deposit insurance coverage levels for Deposit Money Banks from N500,000 to N5 million.

The Managing Director of NDIC, Bello Hassan, announced this in Abuja at a press conference, stating that it takes effect immediately.

He said, “For Deposit Money Banks, the increase of the maximum deposit insurance coverage from N500,000 to N5,000,000, would provide full coverage of 98.98% of the total depositors compared with the current cover of 89.20%.

“In terms of the value of deposit covered, the revised coverage would increase the value of deposits covered by deposit insurance to 25.37% compared with the current cover of 6.31% of total value of deposits.

“The increase of the maximum deposit insurance coverage from N200,000 to N2,000,000, would provide full coverage of 99.27% of the total depositors compared with the current level of 98.76% and would increase the value of deposits covered by deposit insurance to 34.43% compared with 14.38% of total value of deposit, currently covered.

“The increase of the maximum deposit insurance coverage from N500,000 to N2,000,000 would provide full coverage of 99.34% of the total depositors compared with the current 97.98% and would increase the value of deposits covered by deposit insurance to 21.04% compared with 10.77% of total value of deposit, currently covered.”

Hassan also stated that raising the maximum deposit insurance coverage for primary mortgage banks from N500,000 to N2,000,000 would provide full coverage for 99.99% of total depositors and increase the value of deposits covered by deposit insurance to 43.10% of the total deposit value, up from the current 40.60% cover.

The Corporation has also raised the maximum pass-through deposit insurance coverage for subscribers of Mobile Money Operators from N500,000 to N5,000,000 per subscriber.

Business

Dangote Speaks On Devaluation Of Naira

Published

4 days ago

May 1, 2024

Editor

Chairman of Dangote Industries Limited, Aliko Dangote has said that the devaluation of Naira created the biggest mess for the company in 2023.

Speaking at the annual general meeting of Dangote Sugar Refinery, Dangote said this affected lots of companies in the country.

He said: “We are doing whatever it takes to make sure that at the end of the day, we will be paying dividends because if you look at our dividends last year, it was almost 50 percent more so we will try and get out of the mess.

“The biggest mess created was actually the devaluation of the naira from N460 to N1,400. You can see almost 97 percent of the companies, especially in food and beverages businesses, none of them will pay dividends this year for sure but, we will try and get out of it as soon as possible.

“We want to see that at the end of the day, no matter how small, we will be able to pay some dividends, especially if there is a rebound of the naira.”